Malaysia now requires special permits for transporting high-performance US chips – including those just passing through the country for AI applications.

“Malaysia stands firm against any attempt to circumvent export controls or engage in illicit trade activities by any individual or company, who will face strict legal action if found violating the laws,” the country’s Ministry of Trade announced.

The new rules mean anyone transporting AI chips from the US through Malaysia – including transit to China – now needs government approval. The move effectively makes Malaysia an extension of US export controls, coming amid growing tensions over China’s access to advanced AI chips. The policy takes effect immediately.